An entity (either a person or an institution) named by the investor to inherit their estate or part of their estate after death.
California is a community property state which means that any earnings and assets acquired during the marriage belong equally to both spouses, regardless of who actually earned the income. Property acquired before marriage, or gifts and inheritances received by one spouse during a marriage, are generally the separate property of that spouse. A joint account between a husband and wife in which upon death of one spouse his/her half of the account is transferred to his/her heirs.
An account established for a child that is not of legal age. The account must use of the name of the minor child as well as one adult, or custodian. A custodian is an adult acting on behalf of a minor in a security account.
DURABLE POWER OF ATTORNEY – HEALTH CARE
You and your family can appoint a person of your choosing to make decisions regarding your health care treatment in the event that you are unable to provide “informed consent”. In the event that your or someone in your family are unable to soundly appoint this person, the court will appoint someone for you.
DURABLE POWER OF ATTORNEY – PROPERTY
You and your family can also appoint a person of your choosing to handle financial matters should you be unable do so. This is also possible for people who have moved out of state or are living abroad and need a professional person to look after their assests.
If you do not have an estate plan in place at the time of your death, the state distributes your property according to the laws of intestacy. These laws vary by state. For more information on this subject please read the following blog post.
Joint tenancy is a method of holding title to property when two or more people own property together, but the last survivor will own the property outright. When a joint tenant dies, his or her interest goes automatically to the survivor; there is no probate and a will or living trust has absolutely no effect on joint tenancy property.
There may be adverse tax consequences to the joint tenant who dies first. There is a presumption that the entire fair market value of the property is part of the decedent’s estate for estate tax purposes, unless the surviving joint tenant can prove (through financial records) the amount of his or her share of the payments made towards the purchase, improvement or upkeep of the jointly held property. For instance, if the surviving tenant can prove he or she made a 30 percent contribution towards the purchase, improvement or upkeep of the property, then 70 percent of the property will be included in the deceased tenant’s estate for estate tax purposes.
A living trust (sometimes called an “inter-vivos” trust) is a document that is revocable at any time by the person signing it (“grantor”). Living trusts have become quite popular as a method to avoid probate. To avoid probate, the trust must be funded; this means that title to the assets which the grantor owns personally must be actually transferred to the trust — real property is deeded to the trust; bank accounts are switched to the trust; and stocks, bonds, partnership interests and other holdings are assigned or transferred to the trust.
NOTE : The grantor is usually the trustee and beneficiary of the trust during his or her lifetime.
Sometimes called a “Last Will and Testament”, the purpose of a will is to transfer your property to your heirs at your death. A will is a written document that takes effect upon the death of the person signing it (the “testator”). A will covers all property owned by the testator at death. A state court proceeding (“probate”) is instituted and the provisions of the will are implemented under supervision of the probate court. Both the tax and family estate planning objectives of the decedent can be accomplished with a will.
Informational sources include: Edward Jones, Making sense of Investing, Robert Sommers,